IRS offers tax relief to leave-based donation programs for Hurricane Harvey victims
The Internal Revenue Service said Tuesday it is giving special relief to support leave-based donation programs as a way of assisting victims of Hurricane Harvey.
The programs are similar to ones offered by the IRS in the aftermath of Hurricane Katrina in 2005, Hurricane Sandy in 2012, the Ebola outbreak in West Africa in 2014, and Hurricane Matthew and severe flooding in Louisiana in 2016.
Under such programs, employees are able to forgo their vacation, sick or personal leave in exchange for cash payments their employer makes, before Jan. 1, 2019, to charitable organizations providing relief for the victims of this disaster.
Under the IRS’s treatment of the special relief, the donated leave won’t count toward the income or wages of employees, while employers will be allowed to deduct the cash payments as business expenses.
Notice 2017-48, posted Tuesday on IRS.gov, provides details on the relief. The document offers guidance for income and employment tax purposes on the treatment of cash payments made by employers under leave-based donation programs for the relief of victims of Hurricane Harvey and Tropical Storm Harvey.